JPY - Currency Hedger

Currency Hedger August 18, 2026 No Comments

JPY remains near two-week low against US Dollar despite hawkish BoJ bets

The Japanese Yen holds onto two-week losses near 159.50 against the US Dollar.
The BoJ is highly anticipated to raise interest rates in the September policy meeting.
Investors await FOMC minutes, which will be released on Wednesday.

The Japanese Yen (JPY) trades close to its two-week low against the US Dollar (USD) in the Asian trading session on Tuesday at around 159.50. The USD/JPY pair is under pressure even as financial markets are confident about a Bank of Japan (BoJ) interest rate hike in the September meeting.

Yen outlook steadies as MUFG flags elevated BoJ hike odds

Analysts at MUFG highlight that market expectations for further BoJ tightening remain robust, with “the pricing for a 25bp hike at the next meeting in September remains elevated, implying around an 80% probability of a hike.” They argue that this firm rate-hike pricing, set against the backdrop of softer US data, should help limit renewed Yen selling in the near term despite Japan’s weaker-than-expected GDP.

In the latest BoJ Summary of Opinions (SoP), several board members favored further monetary tightening in the near term after leaving interest rates unchanged at 1%. One board member said that the central bank should increase the monetary tightening pace, citing upside inflation risks.

Meanwhile, Japan’s preliminary Q2 Gross Domestic Product (GDP) data has come in weaker-than-expected, an event that could act as headwind for firm BoJ hawkish bets.

Japan growth disappoints as net exports and government spending prop up GDP

Brown Brothers Harriman’s Elias Haddad notes that Japan’s Q2 performance was weaker than expected, with “real GDP rose 0.3% q/q (consensus: 0.5%) vs. 0.5% in Q1” and growth largely reliant on external and public sector support. He points out that the expansion was “driven by net exports (+0.5ppt), government consumption (+0.3ppt), and private inventories (+0.3ppt),” underscoring how net exports and fiscal spending are offsetting softer underlying domestic demand.

On the US Dollar front, the currency is expected to trade sideways as Federal Open Market Committee (FOMC) minutes of the July policy meeting takes the centre stage, which will be released on Wednesday.

In the policy meeting, the Fed left interest rates unchanged in the range of 3.50%-3.75%, as expected and didn’t deliver any forward-guidance on policy rates.

Investors will pay attention to FOMC minutes to get fresh cues regarding inflation and the economic outlook.

USD/JPY Technical Analysis

In the daily chart, USD/JPY trades at 159.51, holding below a dense Fibonacci retracement cluster that keeps the pair capped in the near term. Price sits under the 50.0% retracement at 159.64 and the 61.8% level at 160.67, suggesting topside attempts are vulnerable while these barriers remain intact.

The Relative Strength Index (14) at 44.70 is below the midline, hinting at waning bullish momentum and reinforcing a cautious, mildly bearish bias as the market consolidates after the recent pullback.

On the topside, immediate resistance is located at the 50.0% Fibonacci retracement at 159.64, followed by the 61.8% level at 160.67. Above there, the 78.6% retracement at 162.14 and the cycle high area marked by the 100.0% level at 164.01 define the next barriers. On the downside, initial support emerges at the 38.2% retracement at 158.61 ahead of the 23.6% level at 157.33, with deeper structural support anchored much lower by the extended Fibonacci projection near -46.01, which serves more as a distant reference than a practical downside target.

Currency Hedger August 18, 2026 No Comments

AUD/JPY Price Strengthens to near 113.50, near-term outlook remain constructive

AUD/JPY gathers strength to near 113.40 in Tuesday’s early European session.
The cross keeps the positive tone above the 100-day SMA, with bullish RSI momentum.
The initial support level is seen at 113.00; the first upside barrier to watch is 113.88.

The AUD/JPY cross trades in positive territory around 113.40 during the early European trading hours on Tuesday. The Japanese Yen (JPY) weakens against the Australian Dollar (AUD) amid mounting fiscal concerns and persistent inflationary pressures. Traders await the release of the Australian jobs data, which is due later on Thursday.

Prime Minister Sanae Takaichi’s plan to cut the consumption tax on food to 1% for two years has raised market concerns, as the government has yet to identify an alternative revenue source and the measure is viewed as an ineffective way to combat inflation. Additionally, markets are also concerned about elevated energy costs, which are weighing on Japan’s oil-dependent economy and the Japanese Yen.

Nonetheless, expectations have been mounting for the Bank of Japan (BoJ) to raise rates at its next policy meeting in September. Reuters in a report Friday said the Japanese central bank is considering a rate hike as soon as September. Overnight index swaps are pricing in an about 80% probability of a move by that month.

Yen narrative shifts as BoJ hike odds surge while Fed expectations fade

DBS strategist Philip Wee highlights a sharp repricing in relative policy expectations, noting that “market odds of a September Bank of Japan rate hike have surged to 81% from 21%, while expectations for a Fed hike have plummeted to 32% from 72%.” He argues that JPY bears may be underestimating the implications of this swing in market-implied probabilities, especially against the backdrop of a more supportive stance on higher interest rates from Prime Minister Sanae Takaichi, who is under growing domestic pressure to stabilize the Yen.

Technical Analysis: AUD/JPY maintains a constructive bias in the near term

In the daily chart, AUD/JPY retains a bullish near-term bias as price holds above both the 100-day simple moving average (SMA) and the Bollinger Bands middle line, suggesting a firm underlying demand zone. The Relative Strength Index (14) at 57.55 remains comfortably above neutral, hinting at constructive momentum without yet reaching overbought conditions.

On the downside, immediate support is seen at the 100-day SMA at 113.00, followed by the Bollinger middle band near 112.65. The next contention level is located at the lower band around 110.00.

On the topside, the immediate resistance level emerges at the July 16 high of 113.88, en route to the July 27 high of 114.67. The next hurdle to watch is the Bollinger upper band near 115.25, where a daily close above this ceiling would open the door for a continuation of the uptrend.

Currency Hedger August 17, 2026 No Comments

EUR/JPY Price Tests rising wedge bottom near 184.00

EUR/JPY tests the lower boundary of the rising wedge around 184.10.
The 14-day Relative Strength Index at 50 indicates neutral momentum.
The initial resistance lies at its 50-day EMA near 184.49.

EUR/JPY depreciates after two days of gains, trading around 184.20 during the Asian hours on Monday. The technical analysis of a daily chart indicates that the spot remains within a rising wedge, signaling that the upward trend is losing momentum and that the wedge typically acts as a bearish reversal.

The EUR/JPY cross retains a constructive near-term tone as it holds above the nine-period Exponential Moving Average (EMA), keeping price supported despite last week’s pullback from the highs. The 14-day Relative Strength Index (RSI) around 50 suggests neutral momentum after the prior correction, hinting that directional conviction is still tentative while the broader uptrend structure remains intact.

The EUR/JPY cross tests the immediate support at the lower boundary of the rising wedge around 184.10, followed by the nine-day EMA of 183.78. A decisive break below this confluence support zone would revive the bearish bias, potentially pressing the currency cross down toward its eight-month low of 179.37, recorded on August 3. If downward momentum continues, the next key technical target lies at the nine-month low of 175.70.

On the upside, the primary resistance lies at its 50-day EMA near 184.49, followed by the upper boundary of the rising wedge around 185.80. A sustained break above the wedge could signal a broader bullish resurgence, opening the path for the currency cross to retest the area surrounding its all-time peak of 187.95 set on April 17.

Currency Hedger August 17, 2026 No Comments

AUD/JPY Edges higher above 113.00, bullish bias prevails above 100-day SMA

AUD/JPY gathers strength to around 113.00 in Monday’s early European session.
Japan’s economy expanded annually by 1.1% in Q2, weaker than expected.
The cross holds a constructive bullish bias while holding above the 100-day SMA.
The first downside target emerges at 112.21; the immediate resistance level is seen at 113.88.

The AUD/JPY cross trades in positive territory near 113.00 during the early European session on Monday. The Japanese Yen (JPY) softens against the Australian Dollar (AUD) amid weaker-than-expected Japanese Gross Domestic Product (GDP) data.

Japanese GDP for the second quarter (Q2) expanded at an annualised 1.1%, according to the Cabinet Office on Monday. This figure came in below the market consensus of 2.0% and the first quarter’s reading of 1.8% growth, compared to a 0.5% growth recorded in Q1 and missed market expectations of a 0.5% expansion.

“The details were a mixed bag,” Capital Economics analysts wrote in a research note. “GDP expanded at a decent pace in Q2, and with the government still limiting the pass-through from higher energy prices,” they wrote, while a jump in government consumption “suggests that Takaichi’s expansionary fiscal policies are starting to have an impact.”

Traders await the release of the Australian July employment report on Thursday ahead of Japan’s National Consumer Price Index (CPI) inflation data. Economists expect the Unemployment Rate in Australia to rise to 4.5% in July from 4.4% in June. If the report shows a stronger-than-expected outcome, this could lift the Aussie against the JPY.

Japan data in focus as Deutsche Bank flags solid Q2 growth and firmer inflation

Economists at Deutsche Bank highlight a busy week for Japan, with “key economic data” due including Q2 GDP on Monday and the national CPI on Friday. For GDP, the bank notes that its Chief Japan Economist expects “real GDP to grow at +1.6% QoQ,” while on prices he “forecasts core CPI ex. fresh food to rise to 1.8% YoY from 1.6% in June and core-core inflation ex. fresh food and energy to increase to 1.8% (1.7%).” The bank directs clients to “see more in his full week-ahead” for additional detail.

Technical Analysis: AUD/JPY keeps a mildly positive momentum tone in the near term

In the daily chart, AUD/JPY holds a constructive bullish bias as it sits above the Bollinger middle band and the 100-day simple moving average. The clustering of these supports just beneath spot suggests dips are being absorbed, while the 14-day Relative Strength Index around 54 keeps a mildly positive momentum tone without yet signalling overbought conditions.

On the downside, initial support is seen at the July 8 low of 112.21, followed by the August 10 low of 111.63. The next contention level is seen at the lower Bollinger band near 110.00, which acting as a deeper bearish target if selling accelerates.

On the topside, the immediate resistance to watch is the July 16 high of 113.88, en route to the July 27 high of 114.67. A clear break would open the door to the upper Bollinger band at 115.35.

Currency Hedger August 17, 2026 No Comments

USD/JPY Price Struggles near 159.00; seems vulnerable below 50% Fibo.

USD/JPY trades with a negative bias for the second straight day, though it lacks follow-through.
Japan’s weak GDP print complicates BoJ’s rate-hike path, capping the JPY and limiting losses.
The technical setup warrants some caution before positioning for any meaningful appreciation.

The USD/JPY pair attracts some sellers at the start of a new week, though it lacks bearish conviction and shows some resilience below the 159.00 mark during the Asian session. Moreover, spot prices remain close to a two-week top, touched last Thursday, warranting some caution amid mixed fundamental cues.

The US Dollar (USD) remains depressed amid receding Federal Reserve (Fed) rate hike expectations, which, in turn, is seen as a key factor acting as a headwind for the USD/JPY pair. However, Japan’s soft Q2 GDP print complicates the Bank of Japan’s (BoJ) policy normalization path and holds back traders from placing aggressive bullish bets on the Japanese Yen (JPY). This should lend support to the currency pair and warrants some caution before positioning for deeper losses.

From a technical perspective, the recent recovery from the 155.25-155.20 area, or the lowest since early May, stalled near the 50% Fibonacci retracement level of the intervention-led slump from a four-decade peak. Moreover, the Relative Strength Index (14) sits near a neutral 48, while the Moving Average Convergence Divergence (MACD) has slipped into negative territory, hinting that upside momentum is fading as the USD/JPY pair consolidates below these clustered resistance levels.

That said, some follow-through selling below the 38.2% Fibo. retracement support at 158.58 is needed to back the case for deeper losses to the Fibonacci floor at 157.30 and the broader structural low around 155.24, where buyers would be expected to show more conviction.

On the topside, immediate resistance is located at the 50% Fibo. retracement at 159.61, followed by the 100-period Exponential Moving Average (EMA) on the 4-hour chart at 159.77. Sustained strength above these would open the way toward the 61.8% retracement at 160.64 and then the recent cycle high near 163.98.

USD/JPY 4-hour chart

Currency Hedger August 15, 2026 No Comments

Japanese Yen held as soft US data meets a weak Yen

USD/JPY is little changed in the low-159s on Friday, holding its ground after a volatile stretch.
US Consumer Sentiment fell sharply in August, missing forecasts and adding to a soft week of US data.
A weaker Yen is offsetting the softer Dollar, keeping the pair pinned near current levels.

USD/JPY is holding near 159.40 at the time of writing, with little change on the day. A weak United States (US) Consumer Sentiment reading nudged the Dollar lower, but the pair has stayed close to where it started.

The University of Michigan’s preliminary Consumer Sentiment Index dropped to 51 in August from 55.2, well below the 54.5 that markets expected. The Expectations component fell to 50.6. It is the latest soft US number in a week that also brought cooler inflation and a weak Retail Sales report.

Taken together, that run of data has taken some steam out of the US Dollar (USD), with the Dollar Index (DXY) lower on the day. On its own, a softer Dollar would usually pull USD/JPY down with it.

The boost from the record joint US–Japan intervention in late July and early August has faded, and with no follow-up from Tokyo, speculators have gone back to selling the Japanese Yen (JPY). That leaves USD/JPY caught between a soft Dollar and a soft Yen, with neither side able to take control.

Short-term technical analysis:

On the 4-hour chart, USD/JPY trades at 159.38, maintaining a neutral near-term tone as it holds above the 20-period simple moving average (SMA) at 159.33 but remains capped beneath the 100-period SMA at 160.20. The pair is hovering just under the nearby horizontal barrier at 159.39, while the Relative Strength Index (14) around 56 suggests mildly constructive momentum without reaching overbought conditions.

On the topside, immediate resistance is located at 159.39, followed by the higher horizontal level at 159.58, before the more significant 100-period SMA at 160.20 comes into view as a broader cap. On the downside, initial support is clustered around the 20-period SMA at 159.33, ahead of the horizontal floors at 159.20 and 159.10, which together form a shallow demand band protecting the recent consolidation area.

Currency Hedger August 14, 2026 No Comments

Chart of the Day – Speculations Around Faster Rate Hikes in Japan — Could USD/JPY Reverse Its Trend?

Key takeaways

The BOJ could raise interest rates as early as September, but for the yen, what the central bank does next may be even more important — Reuters sources suggest the entire rate-hike cycle could accelerate.
Markets are already reacting: investors are pricing in around an 80% probability of a September rate hike, while the yield on 5-year Japanese government bonds has reached a record high.
The yen remains close to 160 per U.S. dollar despite the earlier intervention, and the BOJ’s September meeting could prove to be a key test for the next move in USD/JPY.

USDJPY is edging lower today, partly due to a weaker U.S. dollar, although the yen also appears to be supported by reports from Reuters. According to three anonymous sources familiar with the Bank of Japan’s thinking, the BoJ could raise interest rates as early as September 2026. The central bank is also reportedly considering accelerating the pace of monetary tightening from its recent rate of around two hikes per year. The sources pointed to the possibility of a move at the September 17–18 meeting, although the BoJ has not commented on the reports. For the yen, this could represent an important shift in the narrative, as the market may need to consider not only another rate hike but also potentially shorter intervals between subsequent moves.

The BoJ’s policy rate currently stands at 1%, its highest level in 31 years, after the central bank left rates unchanged at its July meeting.
Markets are pricing in around an 80% probability of a September rate hike, while the yield on 5-year Japanese government bonds has risen to a record high.
The yen remains close to 160 per U.S. dollar despite the joint Japan-U.S. intervention in the FX market in July.

Why could the BoJ accelerate rate hikes?

The main argument in favor of faster monetary tightening is Japan’s increasingly uncomfortable inflation backdrop. Annual wholesale inflation remained around three-year highs in July, while surveys of inflation expectations among households, businesses and economists show readings approaching or exceeding 2%. The exchange rate is particularly important. A weak yen raises the cost of imported energy, commodities and other goods, potentially adding to inflationary pressure across the economy. In July, the Japanese currency fell to its weakest level in around 40 years, and the subsequent rebound was not enough to produce a lasting reversal. With oil prices also elevated, the weak yen has become increasingly relevant to the BoJ’s efforts to control inflation. A change in stance can also be seen in the central bank’s communication. The summary of opinions from the July meeting showed that some BoJ board members favored faster rate hikes to prevent monetary policy from falling behind inflation. Governor Kazuo Ueda has also indicated that the pace of tightening could be accelerated if financial conditions prove too accommodative.

What would faster rate hikes mean for the yen?

For the yen, the key issue is not necessarily a single September hike, but the potential change in the entire interest-rate path. Japan maintained extremely low borrowing costs for years while U.S. interest rates were considerably higher. This gap increased the attractiveness of strategies involving borrowing or funding positions in yen and investing in higher-yielding assets. If the BoJ does move from roughly two hikes per year toward more frequent tightening, the yield differential between Japanese and foreign assets could begin to narrow more quickly. The bond market suggests investors are already partially pricing in such a scenario: following the Reuters report, the yield on 2-year Japanese government bonds, which is particularly sensitive to BoJ policy expectations, moved higher, while the 5-year yield reached a record high. The prospect of higher Japanese interest rates does not automatically imply sustained yen appreciation. USDJPY also depends on U.S. Treasury yields, Federal Reserve policy, energy prices and global demand for the dollar. Elevated U.S. bond yields continue to provide the dollar with a relative advantage, while higher oil prices are unfavorable for Japan as a major energy importer. This also helps explain why the joint Japan-U.S. intervention in July failed to produce a lasting change in the exchange rate trend. Intervention can sharply alter short-term market dynamics, but on its own it may struggle to overcome interest-rate differentials and other macroeconomic forces. For the yen’s longer-term direction, the key question may therefore be whether a September hike — if it happens — would be an isolated move or the beginning of a faster BoJ tightening cycle.

USDJPY chart (D1, H1)

The pair has recovered part of the losses triggered by the intervention, which does not represent a lasting mechanism for shaping free-market forces. USDJPY remains within an upward price channel, and as long as it stays above 155 and the 200-session exponential moving average (EMA200, red line, around 159), the broader uptrend remains the baseline scenario. A renewed decline toward 156 could increase the probability of a trend reversal and cannot be ruled out if the BoJ delivers a meaningful shift in monetary policy.

Source: xStation5 On the hourly timeframe, USDJPY remains within a short-term ascending channel. A break below its lower boundary could trigger a 1:1 correction and potentially push the pair toward the 150 area.

Source: xStation5 The chart of speculative positioning in yen futures shows a clear change following the latest interventions. Data released last Friday, covering positions as of the previous Tuesday, showed a rotation from net short to net long positioning. In the past, shifts of this magnitude have tended to provide additional support for the yen. The key question is what the latest positioning data, covering this Tuesday and due to be released today, will show.

Source: XTB

Currency Hedger August 14, 2026 No Comments

EUR/JPY Price Holds ground near 184.00, 50-day EMA

EUR/JPY may test immediate support at its nine-day EMA of 183.59.
The 14-day Relative Strength Index at 48.21, signaling market consolidation.
The initial resistance lies at its 50-day EMA near 184.49.

EUR/JPY remains flat after registering minor gains in the previous day, trading around 183.90 during the Asian hours on Friday. The currency cross is holding above the short-term nine-period Exponential Moving Average (EMA) but remaining capped by the medium-term 50-period EMA.

The moving averages configuration, together with a near-neutral 14-day Relative Strength Index (RSI) at 48.21, suggests a consolidative tone with a slight bearish bias as the pair struggles to reclaim its 50-period EMA while still respecting nearby dynamic support.

The EUR/JPY cross may test the immediate support at its nine-day Exponential Moving Average of 183.59. A decisive break below this short-term indicator would strengthen the prevailing bearish bias, potentially pressing the currency cross down toward its eight-month low of 179.37, recorded on August 3. If downward momentum continues, the next key technical target lies at the nine-month low of 175.70.

On the upside, the primary resistance lies at its 50-day EMA near 184.49. A sustained break above the medium-term price average could signal a broader bullish resurgence, opening the path for the pair to retest the area surrounding its all-time peak of 187.95 set on April 17.